Imprisoned Spy Sentenced to Eight More Years of Incarceration for Conspiracy to Act as an Agent of the Russian Government and Money Laundering

U.S. Attorney’s Office
January 18, 2011

District of Oregon(503) 727-1000

PORTLAND, OR—Harold James Nicholson, 59, was sentenced today to 96 months'
imprisonment by U.S. District Judge Anna J. Brown following his guilty pleas to the crimes of
conspiracy to act as an agent of a foreign government and conspiracy to commit international
money laundering. This eight year prison sentence will be served following the 283-month prison
sentence defendant is currently serving in connection with his 1997 espionage conviction in the
Eastern District of Virginia. Pursuant to the plea agreement, both parties requested the court
imposed the eight-year consecutive sentence. This case represents the first time a convicted spy has
been convicted of new crimes involving a foreign country they spied for while serving a
sentence for espionage.

Harold J. Nicholson, a former Central Intelligence Agency (CIA) employee, is serving a
283-month sentence at the Federal Correctional Institution (FCI) in Sheridan, Oregon, for a 1997
conviction of conspiracy to commit espionage. At the plea hearing, Nicholson admitted that from
2006 to December 2008, with the assistance of his son Nathaniel, he acted on behalf of the
Russian Federation, passed information to the Russian Federation, and received cash proceeds
for his past espionage activities.

Harold J. Nicholson admitted that during the course of the conspiracy he met with his son
Nathaniel on several occasions at FCI Sheridan and provided Nathaniel information intended for
the Russian Federation. Defendant admitted that it was part of the conspiracy that Nathaniel
would travel to several locations including San Francisco, California; Mexico City, Mexico;
Lima, Peru; and Nicosia, Cyprus to meet with agents of the Russian Federation. At these
meetings, Nathaniel provided the Russian Federation information from the defendant and
collected money for the defendant's past espionage activities. Defendant followed the
instructions of the Russian Federation and provided information requested by the Russians to
Nathaniel to deliver to Russian agents at the overseas locations. Defendant directed Nathaniel on
how to covertly travel with the funds from the Russian Federation and how to disperse the funds
to family members.

"Today, former CIA official Harold Nicholson is being held accountable for once again
violating his oath to protect America's national security," said David Kris, Assistant Attorney
General for National Security. "While imprisoned for a prior espionage conviction, Nicholson
dispatched his son around the globe to pass information to and receive cash payments from
agents of the Russian Federation. The many agents, analysts, and prosecutors who uncovered and
put an end to this continued betrayal deserve our thanks."

Dwight C. Holton, United States Attorney for Oregon, stated, "Harold Nicholson
betrayed his country and he betrayed his family—and stooped so low as to involve his son in his
corrupt scheme to collect money for his spying. For his new crimes, Nicholson will spend an
additional eight years in prison. Law enforcement and the Bureau of Prisons should be commended
for an outstanding investigation uncovering these serious crimes."

"At a global level, this investigation shows that international espionage is a threat
America still faces, decades after the end of the Cold War," said Arthur Balizan, Special Agent
in Charge of the FBI in Oregon. "On a personal level, it shows the damage a father can do as he
manipulates a son into a world of dishonor."

The FBI and the Federal Bureau of Prisons investigated this case. Assistant U.S.
Attorneys Pamala Holsinger and Ethan Knight of the U.S. Attorney's Office for the District of
Oregon prosecuted this case. Trial Attorney Patrick Murphy of the Counterespionage Section of
the Justice Department's National Security Division also assisted.